Shri Pawan Kumar Saboo, Howrah V. ITO,Ward-4(2), Guwahati, Guwahati

ITA 103/GAU/2010

• Counselvise Citation: [2013] 119 COUNSELVISE.COM (IT) 3007 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2001-2002
• Appeal Filed On: 23-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K K SARKAR
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA [BEFORE SHRI P.K.BANSAL, A.M. & SHRI GEORGE MATHAN, J.M. ] I.T.A. NO.103/KOL/2010 ASSESSMENT YEAR : 2001-2002 SRI PAWAN KUMAR SABOO, HOWRAH VS- I.T.O., WARD-4(2), GUWAHATI 106, GIRISH GHOSH ROAD, BELURMATH, HOWRAH- 711 202 (PAN:AFHPS 6970H) ( APPELLANT ) ( RESPONDENT ) DATE OF CONCLUDING THE HEARING : 06.02.2013 DATE OF PRONOUNCING THE ORDER : 14.02.2013 APPEARANCES : FOR THE APPELLANT : SHRI K.K.S ARKAR : FOR THE RESPONDENT : SHRI ASOKE KUMAR D EY, SR.D.R. O R D E R PER BENCH : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), GUWAHATI DATED 5 TH APRIL, 2010 FOR THE ASSESSMENT YEAR 2001-2002 BY T AKING THE FOLLOWING EFFECTIVE GROUNDS. I) FOR THAT THE LEARNED CIT (APPEALS) WAS NOT JUSTI FIED IN UPHOLDING THE ADDITION MADE BY A.O. OF RS.1,64,500/- ON ACCOUNT OF TWO SUNDRY CREDITORS UNDER THE HEAD INCOME FROM OTHER SOURCES. II) FOR THAT THE LEARNED CIT(A) IS NOT JUSTIFIED IN UPHOLDING THE ADDITION MADE BY A.O. OF RS.5,00,000/- ON ACCOUNT OF INTROD UCTION TO CAPITAL UNDER THE HEAD INCOME FROM OTHER SOURCES. III) FOR THAT THE LEARNED CIT(A) IS NOT JUSTIFIED IN UPHOLDING THE ADDITION MADE BY A.O. OF RS.65,000/- ON ACCOUNT OF INTRODUC TION TO CAPITAL UNDER THE HEAD INCOME FROM OTHER SOURCES. IV) FOR THAT THE LEARNED CIT(A) IS NOT JUSTIFIED I N UPHOLDING THE ADDITION MADE BY A.O. OF RS.90,020/- ON ACCOUNT OF INTRODUC TION TO CAPITAL UNDER THE HEAD INCOME FROM OTHER SOURCES . 2 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 2. GROUND NO.1 RELATES TO THE SUSTENANCE OF ADDITIO N OF RS.1,64,500/-. BRIEF FACTS RELATING TO THIS GROUND ARE THAT THE AO NOTIC ED DURING THE COURSE OF THE ASSESSMENT THAT THE ASSESSEE HAD TAKEN THE ADVANCES SHOWN IN THE BALANCE-SHEET TO THE EXTENT OF RS.22,97,640/- FROM DIFFERENT PARTIES AS DETAILED AT PAGE 2 OF THE CIT(A). THE AO SENT NOTICES TO ALL THE SIX PARTIES. OUT OF THESE, FOUR PARTIES CONFIRMED THE BALANCE-SHEET, WHICH WERE PLACED ON R ECORD. IN THE CASE OF OTHER TWO PARTIES, HOWRAH IRON FOUNDRY AND KALIMATA IRON. THE LETTERS CAME BACK UNSERVED WITH POSTAL REMARK NOT KNOWN. THEREFORE, THE AO M ADE THE ADDITION OF RS.1,64,500/- RELATING TO SAID TWO PARTIES. THE ASS ESSEE WENT IN APPEAL BEFORE THE CIT(A). THE CIT(A) CONFIRMED THE ORDER OF THE AO. 3. BEFORE US, THE LD. A.R. VEHEMENTLY SUBMITTED THA T THE ASSESSEE HAD SUBMITTED THE CONFIRMATIONS WHICH ARE AVAILABLE AT PAGE 8 AND 9 AND HAS ALSO FILED THE BILLS IN RESPECT OF BOTH THE PARTIES DATED 16.5 .01 AND 27.3.2002 POINTING OUT THAT THE ADVANCES RECEIVED FROM THESE PARTIES DULY GOT A DJUSTED IN THE SUBSEQUENT YEAR AGAINST THE SALES MADE TO THESE PARTIES. THE AUTHOR ITIES BELOW DID NOT CONSIDER THE SUBMISSIONS OF THE ASSESSEE BUT MADE THE ADDITION. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE ORDER OF THE AUTHORITIES BELOW. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y CONSIDERED THE SAME. IN OUR OPINION, THE ADVANCES RECEIVED BY THE ASSESSEE FROM THESE TWO PARTIES I.E. HOWRAH IRON FOUNDRY AND KALIMATA IRON WERE DULY ADJ USTED IN THE SUBSEQUENT YEAR AGAINST THE SALES MADE BY THE ASSESSEE TO BOTH THE PARTIES. SINCE THE ADVANCES RECEIVED WERE DULY ADJUSTED AND SET OFF AGAINST THE SALES, WHICH WERE MADE TO THESE PARTIES AND THERE REMAINED NO ADVANCES IN THE SUBSEQUENT YEAR. IN OUR OPINION, THE ADDITION MADE BY THE AO CANNOT BE SUST AINED AS THE AMOUNT IS MERELY THE ADVANCES RECEIVED FROM THE CUSTOMERS AND THE SA ID ADVANCES HAVE DULY BEEN SET OFF AGAINST THE SALES MADE TO THESE PARTIES. TH E COPIES OF THE BILLS WERE DULY PLACED ON RECORD. EVEN THE ASSESSEE RECEIVED THE CO NFIRMATIONS FROM BOTH THE PARTIES THAT THEY HAVE MADE THE ADVANCES. IN VIEW O F THESE FACTS, WE SET ASIDE THE 3 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 ORDER OF THE CIT(A) ON THIS GROUND AND DELETE THE A DDITION OF RS.1,64,500/-. THUS, GROUND NO.1 OF THE ASSESSEES APPEAL STANDS ALLOWED . 5. GROUND NO.2 RELATES TO THE ADDITION OF RS.5 LAKH S MADE ON ACCOUNT OF THE INTRODUCTION OF THE CAPITAL UNDER THE HEAD INCOME FROM OTHER SOURCES. BRIEF FACTS RELATING TO THIS GROUND ARE THAT THE ASSESSEE HAS I NTRODUCED A SUM OF RS.2 LAKHS ON 07.03.2001 AND RS.3 LAKHS ON 29.03.2001 IN THE CAPI TAL OF HIS PROPRIETORSHIP CONCERN. THE ASSESSEE EXPLAINED THE SOURCE THAT A S UM OF RS.5 LAKHS WAS RECEIVED FROM TEA BROKERS (GUWAHATI) PVT. LTD. ON 10.02.2001 AND FOR WHICH THE ASSESSEE HAS SUBMITTED THE CONFIRMATION AS WELL AS THE COPY OF THE BANK STATEMENT. THE AO WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSES SEE AND THEREFORE, HE MADE THE ADDITION UNDER SECTION 69 BUT OBSERVED THAT THE SUM OF RS.5 LAKHS WAS NOT FOUND IN THE BANK ACCOUNT. THEREFORE, THE CLAIM OF THE ASSES SEE THAT IT WAS RECEIVED FROM TEA BROKERS (GUWAHATI) PVT. LTD. ON 10.02.2001 REMA INS UNPROVED. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A). THE CIT(A) CONFIR MED THE ORDER OF THE AO ON THIS GROUND. 6. BEFORE US, THE LD. A.R. FILED THE CONFIRMATION R ECEIVED FROM M/S. TEA BROKERS (GUWAHATI) PVT. LTD., WHICH IS AVAILABLE AT PAGE 19 OF THE PAPER BOOK ALONG WITH PERMANENT ACCOUNT NUMBER. THE LD. A.R. F URTHER SUBMITTED THAT THE ASSESSEE IS HAVING THREE BANK ACCOUNTS WITH PUNJAB NATIONAL BANK IN CURRENT A/C. NOS. 3831, 13474 AND 12001. THE ASSESSEE HAS GIVEN TEMPORARY LOAN TO TEA BROKERS (GUWAHATI) PVT. LTD., OUT OF WHICH CURRENT ACCOUNT NO.3831 AMOUNTING TO RS.5 LAKHS, RS.2 LAKHS ON 8.6.2000 AND RS.3 LAKHS O N 21.6.2000, OUT OF HIS PROPRIETORSHIP CONCERN M/S. GIRIRAJ STEEL. FOR THIS , OUR ATTENTION WAS DRAWN TOWARDS PAGE NO.21 BACK AND 22. IT WAS POINTED OUT THAT M/S. TEA BROKERS (GUWAHATI) PVT. LTD. TOOK A CHEQUE ON 7.2.2001 FOR A SUM OF RS.5,35,858/- IN THE NAME OF THE ASSESSEE, WHICH WAS DEPOSITED IN THE PU NJAB NATIONAL BANK, GUWAHATI BRANCH ACCOUNT NO.13474. IN THIS REGARD, ATTENTION WAS DRAWN TOWARDS THE CONFIRMATION RECEIVED FROM TEA BROKERS (GUWAHATI) P VT. LTD. AS WELL AS THE BANK 4 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 ACCOUNT OF THE ASSESSEE AT PAGE NO.29. IT WAS POINT ED OUT THAT THE SAID CHEQUE WAS CREDITED IN THE BANK ACCOUNT ON 10.2.2001. IT WAS P OINTED OUT THAT SUBSEQUENTLY THE ASSESSEE TRANSFERRED THE SUM OF RS.5 LAKHS ON 12.02 .2001 TO G.D. ENTERPRISE, THE PROPRIETORSHIP CONCERN OF THE ASSESSEE AND THE SAID LOAN WAS REFUNDED BY G.D. ENTERPRISE, RS.2 LAKHS ON 7.3.2001 AND RS.3 LAKHS O N 29.3.2001 TO TRANSFER OF THE FUND TO THE ACCOUNT NO.3831 OF GIRIRAJ STEEL TRADER S FOR WHICH ATTENTION WAS DRAWN TO PAGE NOS.25 AND 26 OF THE PAPER BOOK. THUS, IT W AS CONTENDED THAT THE ASSESSEE HAS DISCHARGED HIS ONUS AND UTILIZED THE FUND WHICH WAS INTRODUCED BY THE ASSESSEE IN THE PROPRIETORSHIP CONCERN. TEA BROKERS (GUWAHATI) PVT. LTD. IS A PRIVATE LIMITED COMPANY AND THE FUNDS WERE TAKEN AS ADVANCE ONLY THROUGH THE ACCOUNT PAYEE CHEQUE. NOT ONLY THIS, THE ASSESSEE H AS EARNED THE INTEREST FROM M/S. TEA BROKERS (GUWAHATI) PVT. LTD. ON WHICH THE TDS A MOUNTING TO RS.7,933/- WAS DEDUCTED. THE AO HAS DULY TAKEN INTO ACCOUNT THE IN TEREST INCOME. M/S. TEA BROKERS (GUWAHATI) PVT. LTD. HAS THE PERMANENT ACCO UNT NUMBER. IT IS NOT THE ALLEGATION THAT THE TEA BROKERS FROM WHOM THE AMOUN T OF RS.5 LAKHS WAS RECEIVED, DOES NOT APPEAR IN THE BANK ACCOUNT OF THE ASSESSEE . THE AMOUNT IS CLEARLY AVAILABLE IN THE BANK ACCOUNT. THE AMOUNT WAS RECEI VED ULTIMATELY ON 7.3.2001 AND 29.3.2001 AMOUNTING TO RS.2 LAKHS AND 3 LAKHS R ESPECTIVELY. THUS, IT WAS CONTENDED THAT THE ADDITION MADE MUST BE DELETED. O N THE OTHER HAND, THE LD. D.R. RELIED ON THE ORDER OF THE AO. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THIS CASE, THE ADDITION HAD BEEN MADE BY THE AO, WHICH WAS DISCLOSED AS AN INVESTMENT UNDER SECTION 69 OF THE INCOME-TAX ACT AND ACCORDING TO AO, THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF THE AMOUNT. WE HAVE GONE THROUGH THE BANK ACCOUNTS AS WELL AS THE CONFIRMATIONS FILED BY THE ASSESSEE FROM TEA BROKERS (GUWAHATI) PVT. LTD. WE K NOW THAT ULTIMATELY THE AMOUNT CAME TO THE BANK ACCOUNT OF THE ASSESSEES P ROPRIETORSHIP CONCERN, I.E. GIRIRAJ STEEL TRADERS OF RS.2 LAKHS ON 7.3.2001 AND RS.3 LAKHS ON 21.3.2001 BY 5 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 WAY OF TRANSFER FROM G.D.ENTERPRISES. THIS IS APART FROM THE FACT THAT THE ASSESSEE HAS RECEIVED A SUM OF RS.5,35,858/- FROM M/S. TEA B ROKERS (GUWAHATI) PVT. LTD. AS REFUND OF THE LOAN EARLIER ADVANCED BY THE ASSES SEE ALONG WITH INTEREST THEREON. M/S. TEA BROKERS (GUWAHATI) PVT. LTD. IS AN INCOME- TAX ASSESSEE, THE IDENTITY OF WHICH IS NOT DOUBTED. THE AMOUNT HAS BEEN RECEIVED THROUGH CHEQUE AND HAS DULY COME IN THE BANK ACCOUNT OF THE ASSESSEE. UNDER THE SE FACTS, IN OUR OPINION, THE ASSESSEE HAS DISCHARGED HIS ONUS AND WE, THEREFORE, DELETE THE ADDITION BY SETTING ASIDE THE ORDER OF THE CIT(A). THUS, GROUND NO.2 ST ANDS ALLOWED. 8. GROUND NO.3 RELATES TO THE ADDITION OF RS.65,000 /-. BRIEF FACTS OF THE GROUND ARE THAT THE ASSESSEE HAS INTRODUCED ON DIFFERENT D ATES A SUM OF RS.65,000/- IN HIS PROPRIETORSHIP CONCERN, WHEN THE AO HAD ENQUIRED TH E SOURCE. THE ASSESSEE EXPLAINED THAT THE SAID AMOUNT HAS BEEN ACCUMULATED FROM THE BANK ACCOUNT FROM TIME TO TIME FOR WHICH A SEPARATE CASH BOOK WAS MAI NTAINED. THE AO DID NOT AGREE BUT MADE THE ADDITION. WHEN THE MATTER WENT BEFORE THE CIT(A), THE CIT(A) CONFIRMED THE ACTION OF THE AO. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y GONE THROUGH THE SAME. THE ASSESSEE REITERATED THE SUBMISSIONS THAT OUT OF CASH IN HAND ACCUMULATED FROM ITS WITHDRAWALS FROM THE BANK ACCOUNT OF THE ASSESS EE BUT ON GOING THROUGH THE BANK ACCOUNT AND CASH BOOK AND KEEPING IN VIEW OF T HE DOCUMENTS OF THE ASSESSEE, WE ARE NOT SATISFIED WITH THE EXPLANATION OF THE AS SESSEE. WE, THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) AND CONFIR M THE ORDER OF THE CIT(A) OF RS.65,000/-. ACCORDINGLY, WE DISMISS THIS GROUND. T HE ADDITION OF RS.65,000/- IS SUSTAINED. 10. FOURTH GROUND OF THE APPEAL RELATES TO THE ADDI TION OF RS.90,020/- MADE BY THE AO ON ACCOUNT OF THE INTRODUCTION TO THE CAPITA L IN THE PROPRIETORSHIP CONCERN BUT SUSTAINED BY THE CIT(A). 6 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 11. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFUL LY GONE THROUGH THE SAME. WE NOTED THAT BOTH THE AUTHORITIES BELOW CONFIRMED THE ADDITION AS THEY DID NOT FIND ANY RECORD FOR THE WITHDRAWAL OF A SUM OF RS.9 0,000/- IN THE BANK ACCOUNT NO. 12001 MAINTAINED BY THE ASSESSEE WITH THE PUNJAB NA TIONAL BANK. WE HAVE GONE THROUGH THE COPY OF THE BANK ACCOUNT WHICH IS AVAIL ABLE AT PAGE NOS.30 TO 36. FROM THE COPY, WE NOTED THAT THE ASSESSEE HAD TRANS FERRED ON 13.9.1999 A SUM OF RS.70,000/- IN THE CURRENT ACCOUNT OF THE PROPRIETO RSHIP CONCERN BEARING NO.3831 AND SIMILARLY, THE ASSESSEE HAD TRANSFERRED ON 15.1 2.1999 A SUM OF RS.20,000/- IN HIS PROPRIETORSHIP CONCERN VIDE CHEQUE NO.50962 AND 50966. THIS FACT IS APPARENT FROM PAGE NO.34 OF THE PAPER BOOK CONSISTING OF THE PHOTO COPY OF THE PASS BOOK. THE SUM OF RS.20/- IS A PETTY AMOUNT AND IS ALSO AP PEARING AS TRANSFER ON 22.3.2001 IN THE PASSBOOK AT PAGE 36. UNDER THESE F ACTS, IN OUR OPINION, THE OBSERVATIONS MADE BY THE AUTHORITIES BELOW ARE NOT CORRECT AND THE SUM OF RS.90,020/- IS DULY APPEARING IN THE PUNJAB NATIONA L BANK ACCOUNT NUMBER ON THREE DATES AMOUNTING TO RS.70,000/-, RS.20,000/- A ND RS.20/-. UNDER THESE FACTS, WE FIND THAT THE ASSESSEE HAS DULY EXPLAINED THE SO URCE OF THE CAPITAL INTRODUCED IN THE FIRM AMOUNTING TO RS.90,020/-. WE, THEREFORE, S ET ASIDE THE ORDER OF THE CIT(A) ON THIS GROUND. WE DELETE THE ADDITION AND ALLOW GR OUND NO.4 TAKEN BY THE ASSESSEE. 12. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. THIS ORDER IS PRONOUNCED IN THE COURT ON 14 TH FEBRUARY, 2013. SD/- SD/- (GEORGE MATHAN) (P. K. BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 14 TH FEBRUARY, 2013 7 I.T.A. NO.103/KOL/2010 SHRI PAWAN KUMAR SA BOO ASSES SMENT YEAR : 2001-02 COPY OF THE ORDER FORWARDED TO: 1. SRI PAWAN KUMAR SABOO, HOWRAH, 106, GIRISH GHOSH RO AD, BELURMATH, HOWRAH- 711 202 2 I.T.O., WARD-4(2), GUWAHATI 3. THE CIT(A), KOLKATA 4. CIT, KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, ASSTT. REGISTRAR , ITAT, KOLKATA TALUKDAR(SR.P.S.)